Looking to Become a Landlord?

Becoming a Landlord

So, you’ve decided you want to try your hand at landlordship. We don’t blame you; even though there’s a lot of work upfront, the long-term return can be quite lucrative. We’ve put together this list of things to prepare and research before you purchase your first income property.

  1. Your Finances – Make sure your own finances are in order. It’s wise to have a little cushion in the bank because the fact of the matter is, it might be a few months before you start profiting.
  2. Property Selection – It’s not just about the neighborhood. Renters especially families will also consider the local schools, job market, crime rates and even amenities. This is especially true if you want to attract good, long-term renters, they’ll be looking to live and work in a safe area where they can easily access conveniences such as shopping and nightlife.
  3. Competition – Be sure to look into what future developments might be happening in the areas you’re looking to purchase your rental property. New construction could mean new competition.
  4. Vacancy Rates – These rates can affect your ability to generate income. High vacancy rates often force landlords to lower their monthly rent in order to attract tenants. Meanwhile, low rates often mean a landlord can increase the rental price.
  5. Additional Costs – Remember, you going to need to factor in the cost of insurance, taxes, legal fees, months where a unit or units are vacant, maintenance and a property management company among other things.

So before you begin, do your research, carefully manage your finances and plan ahead as best you can for both the expected and the unexpected expenses. If you’re ready to get started, click here to apply for financial assistance on your buy to rent property.

Factor In These Features

Flip & Investment Property Checklist

In a previous blog we reminded investors to consider the cost of landscaping in their overall evaluation of the property. Remembering to do this helps determine the renovation cost, loan amount, property list price and the potential profit. There are however, a few more things flippers and landlords often forget to inspect or consider prior to the purchase, here’s a helpful list of things to remember.

  • Exterior features such as siding, brick and stucco
  • Landscaping
  • Septic, well and indoor plumbing
  • HVAC system
  • Foundation and concrete work
  • Decking/railings, banisters and other features which may pose a safety concern
  • Any back taxes owed on the property
  • Homeowners association fee

Additionally, if you’re going to rent the property or you are a landlord to the property you’ll want to factor in these things as well:

  • Heating and cooling costs
  • Insurance
  • Routine maintenance
  • Legal expenses (should you have to evict a tenant, etc.)

Have an eye on your next investment project? Join the hundreds of other investors who are applying for and receiving funding right from our website! Call or text today if you have questions or would like to speak to a hard money lending expert. 203-974-3322.

The ABC’s of LLC’s – 5 Easy Steps to Registering Your Business

The ABC’s of LLC’s 

5 Easy Steps to Registering Your Business

Before you can obtain a hard money loan for funding your residential fix and flip, fix and lease, and buy to lease projects, you must be a registered business. Taking care of this important step will save you time during the underwriting process. Here are five easy steps to help you get going.

The first thing is to select the state in which you’ll be doing the majority of your business in. Keep in mind this is a general overview, the exact requirements vary from state to state. If you plan operating in multiple states you may apply for a foreign entity in the other state(s). Two important numbers to have on hand will be your Secretary of State’s office, and your CPA, who can help you determine which is in your best interest, establishing an LLC or, a Corporation.

Once you have determined what type of business to establish, you’ll want to name it. The name must be available for use (not in use by another entity) and must comply with your specific state’s rules. In addition, if you name your LLC or corporation one thing, and do business publicly as another, you will need to file for a DBA statement. DBA stands for “Doing Business As.”

If you chose to become an LLC, you’ll file “Articles of Organization.” This is a fairly simple process which can be completed in a few short steps and is done through the Secretary of your state. If you choose to establish a corporation, we refer to the document in this step as, Articles of Corporation. Articles of Corporation also contain Corporation By Laws.

LLC’s will prepare an Operating Agreement. This agreement outlines the financial agreements and rights of the individuals who are to be involved in the business. If there are multiple individuals involved the Operating Agreement should reflect ownership percentage. All members listed on the Operating Agreement will need to also be listed on the loan application.

The last step is to obtain an EIN (Employer Identification Number) or, a Federal Tax Identification Number. This step is necessary if you plan to have employees.

It is in your best interest to keep your entity in good standing by filing yearly reports. Also, as mentioned, it’s important to have your business registered before you apply for your loan. This way, you can start looking for the perfect investment opportunities and Lend Some Money can get you approved for funding in as little as 24-hours.